SHANGHAI, March 4 (Reuters) - China stocks settled higher on Wednesday as investors hoped for more domestic policy stimulus after the U.S. Federal Reserve cut interest rates to tackle the economic fallout from the coronavirus.
** Additionally, economists urged for swift support to avoid mass bankruptcies after China’s services sector had its worst month on record in February, a business survey showed.
** The blue-chip CSI300 index rose 0.6% to 4,115.05, while the Shanghai Composite Index gained 0.6% to 3,011.67 points.
** The Fed cut rates by 50 basis points in an emergency move on Tuesday that underscored the U.S. central bank’s concern over the epidemic, sending Wall Street indexes sharply lower overnight. ** China, which has already rolled out a raft of measures to support the virus-hit economy, kept short-term borrowing costs steady on Wednesday, shrugging off the surprise rate cut. ** However, markets widely believe Chinese policymakers will continue their efforts to lower financing costs for businesses. ** The People’s Bank of China’s approach is not closely following Fed’s move, as it will take its own proactive steps depending on the situation here, said Xiao Shijun, an analyst with Guodu Securities. ** The A-share market is relatively safe for now, as its valuations are reasonable and low, both historically and globally, while the bull run in the U.S. stock market has continued for more than 10 years, the analyst said. ** Meanwhile, China reported another drop in new coronavirus cases, further bolstering risk sentiment in the region. ** The CSI300 financial sector sub-index was 1.41% higher, while the consumer staples sector rose 1.43%. Real estate stocks climbed 3.6% and the healthcare sub-index was 0.25% higher. ** The smaller Shenzhen index ended 0.36% in the black, while the start-up board ChiNext Composite index was 0.18% weaker. ** Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.37%, while Japan’s Nikkei index closed up 0.08%. ** The largest percentage gainers in the main Shanghai Composite index were Nanjing Chixia Development Co Ltd, up 10.15%, followed by Baoding Tianwei Baobian Electric Co Ltd , which was 10.07% higher, and Lushang Health Industry Development Co Ltd, up 10.06%. ** The largest percentage losses in the Shanghai index were Xiangtan Electric Manufacturing Co Ltd, down 8.56%, followed by Suzhou Secote Precision Electronic Co Ltd , which lost 8.51%, and GigaDevice Semiconductor Beijing Inc, down 8.14%. (Reporting by Shanghai Newsroom; Editing by Devika Syamnath)